The FTC recently examined ADT's use of non-disparagement and related provisions in the terms and conditions of its websites and online services directed to consumers. The FTC was concerned that ADT's terms prohibited parties linking to the ADT's sites from disparaging ADT, its products or services, or any of ADT' s affiliates or their products or services. The FTC closed the investigation, in part because ADT had substantially discontinued using this language in its online terms prior to being contacted by the FTC. However, FTC's closing letter is instructive.
In the Letter, the FTC noted that "Form contract provisions, including in online terms, that purport to prohibit or restrict the otherwise lawful content or context of an individual's review on a linking site might violate Section 2(c) of the Consumer Review Fairness Act..." Further, the FTC noted, "[t]he use of, including any attempts to enforce, such restrictions_to limit consumers' discussions of truthful or non-defamatory information or opinions about a seller also might be unfair or deceptive conduct under Section 5 of Federal Trade Commission Act...".
Online sellers should be aware that using contractual terms to limit consumers' ability to provide honest reviews of their products and services may well invite regulatory scrutiny.
"Links to sellers' web pages in consumers' online reviews can be an important way for consumers to share information about the specific goods, services, or seller conduct they are discussing."
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